Highlights from the 2017 DCIA Spring Forum

The Delaware Captive Insurance Association (DCIA) held its 2017 Spring Forum May 8-9 on the Wilmington riverfront. Conference attendees included leading captive service providers, captive owners and Delaware’s captive regulators. Delaware Insurance Commissioner Trinidad Navarro made a surprise announcement that Steve Kinion will stay on as Director of the Bureau of Captive and Financial Insurance Products (the Bureau) for at least another year. This resulted in a standing ovation from the attendees.

The conference’s first session took place one week after the deadline to file under IRS Notice 2016-66 and touched on what’s next. Many attendees had put forth a monumental effort to comply with the requirements of Notice 2016-66, and this conference was their first opportunity to come up for air. The speakers leveraged their experience working with other industries that have been subject to IRS reportable transaction requirements in advising conference attendees to prepare for continued work to satisfy these and other requirements as the IRS continues its investigations.

A subsequent conference session addressed the uncertainty in the enterprise risk captive space, which is expected to continue at least until the results of Avrahami v. Commissioner are known. This was the first captive insurance case related to the 831(b) election litigated in the U.S. Tax Court, and it was tried in March 2015. That ruling is expected to come out later in 2017, and the industry is hoping the tax court decision will clear up many of the disputed issues.

Steve Kinion, Director of the Bureau, noted that Delaware has about 200 captive exams to complete for year-end 2016. This year the exam process will be streamlined and accelerated to require that the examiner issue a draft exam to the department of insurance within two weeks. The goal is for the exam report to be finished within 60 work hours, and through the department of insurance within 60 days.

The DCIA 2017 Spring Forum provided great networking opportunities and educational sessions, and we look forward to participating in future events. The Forum presentations can be found here.

Aaron Hillebrandt, FCAS, MAAA, CPCU, CLF, FFSI, FLMI, LPCS, AINS,
is a Consulting Actuary with Pinnacle Actuarial Resources, Inc. in
the Bloomington, Illinois office.
He holds a Bachelor’s Degree in Mathematics from Illinois State University,
where he is now involved as a mathematics lecturer. Aaron is an honorably
discharged Sergeant and combat veteran of the United States Marine Corps. He
has over nine years of actuarial experience in the property/casualty insurance
industry, including considerable experience in assignments involving loss
reserving, funding studies, loss cost projections, captive feasibility studies,
and personal and commercial lines ratemaking.